Philippine Airlines said in a statement issued on December 31 that the company has emerged from bankruptcy after the U.S. court approved its plan to reduce debt by up to $2 billion and obtain additional capital.
Philippine National Airlines has applied for Chapter 11 status under the U.S. Bankruptcy Law to reorganize the company and seek relief from creditors as it attempts to survive the damage caused by the Covid-19 pandemic to the aviation industry.
The airline stated that its court-approved restructuring plan included a reduction of US$2 billion in debt and US$505 million in additional liquidity from major shareholders, adding that it can also choose to obtain up to US$150 million in additional financing from new investors . The main shareholder of the airline is Philippine Airlines Holding Company, which is controlled by the Philippine business tycoon and billionaire Lucio Tan, who is also the CEO and chairman of the airline.
The airline’s consensus restructuring plan was approved by 100% of the votes cast by its major aircraft lessors and lenders, original equipment manufacturers and maintenance, repair and overhaul service providers, and certain long-term debt lenders.
The statement said: “Philippine Airlines has simplified operations by reorganizing its fleet and can now better prepare funds for future growth.”
Pandemic causes air travel in the Philippines to collapse
According to government data, air travel in the Philippines has dropped by more than 75% in 2020 due to travel restrictions imposed to contain the coronavirus.
From 60 million domestic and international passengers in 2019, passenger flow will plummet to just over 13 million in 2020.
Philippine Airlines said in September that since the beginning of the pandemic, it has cancelled more than 80,000 flights, lost $2 billion in revenue, and laid off more than 2,000 employees.
Restore the international and domestic route network
With the reopening of the border and relaxation of travel restrictions, the airline said it will resume regular flights, including flights to cities in mainland China and Australia.
It will also restore its international network, namely direct flights connecting the Philippines to the United States, the east and west coasts of Canada and Hawaii, as well as multiple cities in Japan and the Middle East, as well as convenient timetables to Hong Kong, South Korea, Taiwan, Singapore, Thailand, Indonesia , Vietnam and Malaysia.
The airline said that at home, Philippine Airlines seeks to rebuild its high-frequency domestic network, including routes to major cities such as Visayas, Mindanao and Luzon, as well as inter-island services to the country’s tourist hotspots and resort islands. .
Philippine Airlines said in a statement issued on December 31 that the company has emerged from bankruptcy after the U.S. court approved its plan to reduce debt by up to $2 billion and obtain additional capital. Philippine National Airlines has applied for Chapter 11 status under the U.S. Bankruptcy Law to reorganize the company and seek relief from creditors as it attempts to survive the damage caused by the Covid-19 pandemic to the aviation industry. The airline stated that the reorganization plan approved by its court includes a reduction of US$2 billion in debt and US$505 million in additional liquidity from major shareholders,…
Philippine Airlines said in a statement issued on December 31 that the company has emerged from bankruptcy after the U.S. court approved its plan to reduce debt by up to $2 billion and obtain additional capital.
Philippine National Airlines has applied for Chapter 11 status under the U.S. Bankruptcy Law to reorganize the company and seek relief from creditors as it attempts to survive the damage caused by the Covid-19 pandemic to the aviation industry.
The airline stated that its court-approved restructuring plan included a reduction of US$2 billion in debt and US$505 million in additional liquidity from major shareholders, adding that it can also choose to obtain up to US$150 million in additional financing from new investors . The main shareholder of the airline is Philippine Airlines Holding Company, which is controlled by the Philippine business tycoon and billionaire Lucio Tan, who is also the CEO and chairman of the airline.
The airline’s consensus restructuring plan was approved by 100% of the votes cast by its major aircraft lessors and lenders, original equipment manufacturers and maintenance, repair and overhaul service providers, and certain long-term debt lenders.
The statement said: “Philippine Airlines has simplified operations by reorganizing its fleet and can now better prepare funds for future growth.”
Pandemic causes air travel in the Philippines to collapse
According to government data, air travel in the Philippines has dropped by more than 75% in 2020 due to travel restrictions imposed to contain the coronavirus.
From 60 million domestic and international passengers in 2019, passenger flow will plummet to just over 13 million in 2020.
Philippine Airlines said in September that since the beginning of the pandemic, it has cancelled more than 80,000 flights, lost $2 billion in revenue, and laid off more than 2,000 employees.
Restore the international and domestic route network
With the reopening of the border and relaxation of travel restrictions, the airline said it will resume regular flights, including flights to cities in mainland China and Australia.
It will also restore its international network, namely direct flights connecting the Philippines to the United States, the east and west coasts of Canada and Hawaii, as well as multiple cities in Japan and the Middle East, as well as convenient timetables to Hong Kong, South Korea, Taiwan, Singapore, Thailand, Indonesia , Vietnam and Malaysia.
The airline said that at home, Philippine Airlines seeks to rebuild its high-frequency domestic network, including routes to major cities such as Visayas, Mindanao and Luzon, as well as inter-island services to the country’s tourist hotspots and resort islands. .
